NEW YORK: US Treasury yields rose on Thursday as investors waited on the results from the French election this weekend, after earlier falling to break below key technical resistance.
With no major economic data releases this week investors were focused on the French elections, US tensions with North Korea and any new indications on when the Trump administration is likely to undertake tax and fiscal reforms.
Benchmark 10-year notes have struggled to stay below technical resistance at around 2.19 percent, which was tested in overnight trading, after falling more than 40 basis points in a month.
"The 2.19 percent level represents about 50 percent of the post-election selloff, which is why it's such a significant resistance level," said Thomas Simons, a money market economist at Jefferies in New York.
The 10-year notes  were last down 10/32 in price to yield 2.24 percent. The 10-year yield briefly fell as low as 2.165 percent on Tuesday, the lowest since Nov. 10, and has tumbled from 2.63 percent on March 14.
"We've come a long way very, very fast so gains up here are going to be more difficult to get or sustain," said Mary Ann Hurley, vice president in fixed income trading at D.A. Davidson in Seattle.
Bonds prices have been boosted in recent weeks by reduced expectations that the Federal Reserve will raise interest rates two more times this year following disappointing economic data releases.
The administration of US President Donald Trump is also seen as less likely to pass fiscal or tax reforms in the near term, which had been expected to boost growth.
"Over the last month, the viability of the Trump economic agenda is definitely in question," said Simons.
Futures traders were pricing in a 57 percent chance the US
central bank will raise rates at its June meeting, down from 71 percent on April 6, according to the CME Group's FedWatch Tool.
Dallas Federal Reserve President Robert Kaplan said on Thursday that three interest rate hikes this year remains possible but that the US central bank has the flexibility to wait and see how the economy unfolds.
The Treasury will sell $16 billion in five-year Treasury Inflation-Protected Securities later on Thursday.
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